The Memorandum of Understanding between the NT government and the federal ASA recognises the territory's wide-open spaces and proximity to the equator.

Federal Science Minister Karen Andrews said these natural attributes would appeal to the international space companies and agencies that make up the $3 trillion global industry.

"This MoU will drive the creation of high-tech jobs in the Northern Territory," she said in a statement on Friday.

NT Chief Minister Michael Gunner said the MoU builds on his Labor government's Territory Space Industry 2020 Plan.

"We are perfectly positioned to benefit from the space economy and the jobs it will bring," he said.

"We are close to the equator, we aren't prone to earthquakes, we're close to the sea and sparsely populated areas, and we have great weather."

Later this year, NASA and Equatorial Launch Australia will launch their sounding rocket program from the Arnhem Space Centre in the NT.

"We are in the space race, and we are in it to win it," Mr Gunner said.

ASA head Megan Clark said the MoU will build on the existing assets in the NT.

The federal government is investing almost $700 million in the space sector with the aim of creating up to 20,000 additional jobs by 2030.

Australian Associated Press